Minnetonka, Minn.-based UnitedHealthcare will acquire Grand Junction, Colo.-based Rocky Mountain Health Plans, The Denver Post reported.
Under the terms of the agreement, UnitedHealthcare will invest an undisclosed amount in the nonprofit insurer, gaining access to RMHP's Medicaid market and its 300,000 rural customers. UnitedHealthcare covers 1.2 million people in Colorado.
In addition, RMHP will shift to a for-profit model and sell its stock to UnitedHealthcare. Funds from the stock will go toward the RMHP Foundation to improve healthcare access, according to The Denver Post. However, RMHP will keep its brand, current healthcare provider agreements and management team.
The agreement reflects the payers' other changes in the state. Next year, UnitedHealthcare will cease offering individual plans on the Colorado market, affecting more than 10,000 members. As for RMHP, the insurer will only offer individual plans in Mesa County, leaving 10,000 members uninsured. In addition, RMHP requested some of the highest premium rate increases in the state, with 34.6 percent increases for its individual HMO plan.
Pending regulatory approval, UnitedHealthcare's acquisition of RMHP is expected to be completed by the end of 2016.